Don’t be fooled, the future is state regulation

In my opinion, that famous neo-Hegelian thinker Francis Fukuyama – the man responsible for the predication in the late eighties/early nineties that at the fall of the Berlin Wall, the end-of-history had loomed upon us, and it had shown free-market capitalism to be the victor over socialism – has gone from being a thinker of history, to an illustration of how exactly history has panned out. Allow me to explain.

In the work for which he is best known The End of History and the Last Man (1992), Fukuyama argued that the endpoint of man’s social and cultural evolution has been realised in liberal, free-market democracy, conflicting with other more popular Hegelian thinkers, most notably Karl Marx who asserted that ‘the end of pre-history’ would be the triumph of communism over capitalism.

Fukuyama was considered a key neoconservative thinker ever since the 1992 publication, and was often held by laissez-faire thinkers and businessmen as a source of justification for the pursuit of capital, as well as the primary reference for understanding why revolutionary fronts failed.

This was the opinion that Fukuyama held – in print – until 2003, when he released his book Our Posthuman Future: Consequences of the Biotechnology Revolution, in which he realised the potentially dangerous cost of allowing the pharmaceutical industry a totally free charter to operate, without regulation from either the state or a non-departmental public body (or quango, as they are known colloquially).

Fukuyama cites in the book examples including the issuing of psychotropic drugs to children with behavioural problems, concluding that often corporations have dubious motives in creating and selling them. Ritalin, Fukuyama opines, is one such drug, created in order to cap a child’s instincts, stating that it ‘‘is prescribed largely for young boys who do not want to sit still in class because nature never designed them to behave that way’’ (p. 52). The state, of course, is not devoid of blame here, but attention should be paid to the power of the drugs lobby, especially in the United States, where most of Fukuyama’s attention is focused on.

The future would look even bleaker were biotechnology to be unregulated. Fukuyama worries that Human Genetics has the potential to be used as a tool for misuse, especially in the field of genetic engineering, where opinions on what is considered ‘normal’ be saved, and what is considered ‘abnormal’ be destroyed at the genetic root. Destroying disease would be an obvious benefit, but opinions on so-called racial, sexual, and biological normality in general would cause real tension. Furthermore, genetic engineering, unless curbed and utilised in some way, could be the play thing of the rich, thereby creating the potential of a wealthy “superior breed” – or as one philosopher has stated, a master race with the capabilities of “instigating a new class warfare”.

It is for this reason that once hardcore free-marketer Fukuyama has become concerned with who be trusted to decide the utility value of biotechnological advancements.

More recently Baroness Kennedy of the Shaws QC, chair of the Human Genetics Commission, in her lecture at Gresham College, noted that the argument of the day is not whether genetics be regulated or not, but rather how genetics be regulated?

The same argument, I would argue, goes for the economy in general today. The question, since the crash, should not be whether or not regulation should be set up overseeing the banking system, but rather how this regulation should operate. The Tories’ argument against Alistair Darling’s new plans to give the Financial Services Authority (FSA) new powers ‘to tear up contracts that would result in payments being made that would cause instability’ is that the FSA already has these powers. But the Tories want to scrap the FSA. It doesn’t take a genius to spot the inharmonious position George Osborne has taken of both wanting to come down hard on the City, but opposing the existing regulatory body of the financial system. If he were genuine about his concern for big bonuses (which he obviously isn’t) he would want to expand the FSA, and ask questions as to why they haven’t done more to seek out capitalist greed.

The sixty-four-thousand-dollar-question on the economy is the same one as for genetics, how should regulation operate. Francis Fukuyama, having gone from stating unfettered capitalism as historical victor, to realising that the future is in regulation, is the embodiment of that very question. It is no longer necessary to bicker about whether the invisible hand is the attitude to have towards the functioning of society and economics, but, rather, how best the state, and those it represents, should take full control.


4 Responses to Don’t be fooled, the future is state regulation

  1. Mark Still says:

    Certainly its a long way from being adequately regulated take this appalling over inflated housing market and they print it as good news that they are rising in price even in a recession when pay is going down and unemployment up!

    Housing market!
    For the last 30 years governments have allowed a Zimbabwe style hyper inflation in the housing market! I believe this actually was the main cause to the over borrowing of money that was not even there-hence the result-a credit crunch and long recession! Decent housing for all should be a human right! Housing must b…e freed up from the restrictions of the Free Market ideology! What Housing shortage? There is no fundamental shortage of housing? The real shortage is that of affordable housing! BTL’s should be abolished and prices regulated! Hyper housing inflation must end! Empty decaying homes must end! What do you think?

    • Certainly your view seems to ring true with respected journalists, for example Richard Brooks (of Private Eye) paints a very clear picture on this subject (for the interview with Mark Thomas download here). Inflation was linked to housing prices in that what you were buying was a mortgages’ predicted value, rather than the value in-itself. Judgements by speculators was added to the value of a single house, the bubble was largely filled with predicted money.

  2. Thomas Byrne says:

    But then the real capitalists (Us jolly Austrians) would argue that things such as the banking crisis didnt come from regulation, and I regard any historical materialists with a pinch of salt.

    • Clear off ya bleedin Austrians. Maybe your capitalism can see the poverty of an economy being built on risk, trends, speculation and so-called market trust, but the existing model doesn’t – the same model that is constantly swiped at by oiks from the Smith institute – who have managed to conflate Adam Smith with the most untainted form of libertarianism known to man – for being thoroughly too regulated. If it’s too regulated for you now, just you wait, mate.

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